As a global macro multi-asset manager, our investment process is rooted in a deep understanding of how economies and markets work, and so our starting point as investors has always been to understand how the world works. In service of that mission, we conduct deep, fundamental research across a broad range of topics—we believe markets and economies move for logical reasons that can be studied and understood, and once we understand how something works, we systemize that understanding into our investment process and compound on it through time.
Given our mission, it is inherently important for us to understand environmental and social dynamics, as environmental and social issues can directly impact economic and market outcomes as well as the actions of policy makers. As such, we seek to deeply understand these topics by studying them as an integrated part of our research process and prioritize topics that we believe are most pertinent to our macro investment approach—in other words, those topics we think have material financial relevance to our portfolios. Any research insight related to environmental or social issues that we believe would have a material impact on financial performance is incorporated into our investment process and logic. Since many environmental and social issues have macro linkages, we believe that we are well-positioned to explore the fundamental cause-and-effect relationships at play. Leveraging our nearly 50 years of experience in conducting deep, systematic macro research, we study a wide range of topics related to these issues.
Climate change and the energy transition are among the defining issues of the 21st century, and addressing them will create significant shifts in the underpinnings of the global economy, requiring major responses from governments, companies, investors, and other actors around the world. From an investor perspective, climate change is a multidimensional topic that affects asset markets and economies through many different channels, such as direct physical risks (e.g., rising temperatures and related effects) as well as transition risks (e.g., the impact on transition-related policies and regulations, investment and capital flows, changes to commodity consumption, etc.). We have built out a top-down understanding of the net zero transition, investigating a wide range of climate-related issues such as the breakdown of emissions in public equities, the status of corporate emissions reductions and the green energy transition; financing flows for the net zero transition and investments needed in key climate technologies; the impact of the energy transition on metals markets and how to build a sustainable commodity allocation; the implications of the transition to EVs and China’s path toward decarbonization; the effects of government policy on the green transition, including the Inflation Reduction Act and President Trump’s energy strategy in the USA; as well as fundamental challenges with macroeconomic modeling of physical climate risks. We pair this macro perspective with a systematic bottom-up, company-specific capabilities whereby we granularly assess the sustainability profile of companies – for example, assessing the alignment of corporate decarbonization trajectories to net zero pathways.
Social and societal issues are critical perspectives for understanding the world, and more specifically the drivers of monetary and fiscal policy, politics, economies, and markets. We have deeply researched many different pertinent social topics, including for example the economic, societal, and political impacts of wealth and income inequality and its geographic disparities; how inequality affects central bank tightening; the history, development, and timely importance of populism; how AI could affect productivity and the likely winners and losers; the implications of Sub-Saharan Africa’s demographic explosion and what it would take to change the region’s growth trajectory; and the relationship between immigration and inflation and the contributions of high-skilled immigrants to economic growth.
In general, the research we publish in our Daily Observations provides the best window into the types of environmental- and social-related research that we incorporate into our investment systems. As mentioned above, we share research throughout the year via the Daily Observations and on the Sustainable Investing section of our website.1
Oversight
Bridgewater’s co-CIO Karen Karniol-Tambour chairs our Sustainable Investing Committee, which is responsible for our sustainability research efforts and embedding sustainability considerations across Bridgewater’s investment processes and portfolios. The overall policy and any changes are also periodically reviewed by Bridgewater’s legal and compliance team.
Stewardship and Corporate Engagement Policy
Bridgewater’s Sustainable Investing and ESG Policy is set, implemented, and overseen by the Sustainable Investing Committee, and it covers our approach to corporate engagement, proxy voting, industry collaborations with a broad range of industry actors, including data providers, research institutions, industry partners, and our clients, as well as external affiliations. The policy adheres to the guidelines of the Principles for Responsible Investing (PRI) and aligns with the recommended framework of the Task Force on Climate-related Financial Disclosures (TCFD).
Regarding engagement, equity exposures across our various portfolios tend to be highly diversified with small ownership stakes, so we have chosen, at present, to engage thematically via our partnership with our engagement services provider, Sustainalytics. By approaching these engagements thematically, we aim to think broadly and deeply about the macro challenges that companies are facing, play a role in helping to shape industry standards and best practices, and be more targeted in specific conversations.
We partner with Glass Lewis, a proxy advisor, to implement and vote our shares on behalf of our clients. Glass Lewis is a signatory to the PRI, abides by the principles set forth therein, and considers ESG issues in the process of generating their recommendations where these issues are financially material. Additional detail on our proxy voting practices can be found in our proxy voting policy, which is available in our Form ADV 2A on the SEC’s website or upon request.
Industry collaborations are an important part of our sustainability efforts. As a research-driven firm, we are constantly in pursuit of new insights, and we seek to collaborate with thought leaders in the global sustainable investing community on initiatives that align closely with our research objectives, which is in the spirit of our Principles for Responsible Investment (PRI) commitment to work with others in the industry to enhance our collective effectiveness in integrating sustainability considerations. For example, we have been involved in a collaboration on modern slavery risk assessment growing out of the Brookings Institution’s and Rockefeller Foundation’s 17 Rooms initiative and we are a member of the Investment Leaders’ Group (ILG) convened by the University of Cambridge Institute for Sustainability Leadership (CISL).
In terms of external affiliations, Bridgewater is a signatory to the Principles for Responsible Investment (PRI), a supporter of the Task Force on Climate-related Financial Disclosures (TCFD), a core supporter of the Standards Board for Alternative Investments (SBAI, formerly the Hedge Fund Standards Board), and a member of Focusing Capital on the Long Term. We are also part of ESG working groups at the Managed Funds Association (MFA) and Alternative Investment Management Association (AIMA). Our co-CIO Karen Karniol-Tambour holds various leadership positions on sustainability initiatives such as the G7-backed Impact Taskforce and the International Foundation for Valuing Impacts, and we share our research and insights regularly publicly as well as at industry sessions and conferences.
Quality Control and Compliance in Our Investment Process
Ensuring a high level of quality control and compliance is of paramount importance to us. While we recognize that sustainability research comes with conceptual and analytical challenges, we ensure our policies are implemented through Bridgewater’s overall investment philosophy of being fundamental, systematic, and diversified. This is subject to an independent review by Bridgewater’s compliance team.
All of Bridgewater’s key business processes, including our sustainability research, are subject to review and are supported by Bridgewater’s independent compliance team, which advises on regulatory matters, monitors Bridgewater’s business activities, and conducts risk-based compliance testing to ensure that we are meeting or exceeding our regulatory obligations. The independent compliance team regularly assesses and adjusts its processes to keep pace with evolving regulatory requirements or industry standards related to sustainability or otherwise.
- Bridgewater is deeply committed to meeting or exceeding our regulatory and ethical obligations both to our regulators and to our clients. To make good on this commitment, Bridgewater maintains an independent compliance team, which is led by our Chief Compliance Officer (CCO) and Counsel, Michael Kitson, who reports directly to Helene Glotzer, Bridgewater’s Head of Enterprise Risk Management. Helene reports directly to the CEO and oversees a team that is responsible for maintaining an independent and holistic synthesis of enterprise risk, which helps inform and partner with our CEO in his management and strategic vision. As CCO, Michael is responsible for the design and implementation of Bridgewater’s compliance program, which involves: (a) understanding the regulatory environment, (b) setting standards and policies to facilitate compliance with regulatory requirements, (c) educating and advising employees about regulatory and policy obligations, and (d) monitoring and testing Bridgewater’s activities and ensuring compliance with policy and regulation. Importantly, Bridgewater’s compliance program is not static, but rather evolves in an effort to keep pace with both the dynamic regulatory environment and changes to Bridgewater’s business activities. To do this well, Michael regularly briefs and advises Bridgewater’s CEO and other senior leaders on regulatory changes and any meaningful findings from compliance monitoring or testing.
- In the context of our sustainability research efforts, Bridgewater’s compliance team operates in the same way. In particular, our compliance team regularly briefs members of our Sustainable Investing Committee on key regulatory developments related to sustainable or ESG investing, engages to help set standards and frameworks to inform sustainability efforts, provides regulatory and compliance advice on a variety of matters, and has designed and implemented a monitoring and testing program that serves as an independent double check on certain internal processes.
Finally, we have policies in place to identify and mitigate conflicts of interest, which we describe in sections 6, 10, and 12 of Form ADV Part 2A and our Code of Ethics, both of which are available upon request. Bridgewater aims to identify all conflicts of interest that could incentivize, or even give the appearance of incentivizing, Bridgewater employees to make decisions that may not be in the best interest of our clients.
1Note on portfolio exclusions: as it pertains to our asset holdings and exclusion lists, we ensure that we are compliant with all applicable sanctions. We do not have a firmwide exclusion list across portfolios that excludes investments solely for environmental or social impact reasons.
Important Disclosures and Other Information
Please read carefully the following important disclosures and other information as they provide additional information relevant to understanding the assumptions, research and performance information presented herein. Additional information is available upon request except where the proprietary nature of the information precludes its dissemination.
This presentation contains proprietary information regarding Bridgewater Associates, LP (“Bridgewater”) and the strategies Bridgewater manages and is being furnished on a confidential basis to a sophisticated prospective investor for the purpose of evaluating an investment with Bridgewater. By accepting this presentation, the prospective investor agrees that it (and each employee, representative or other agent of such prospective investor) will use the information only to evaluate its potential interest in a fund or strategy described herein and for no other purpose and will not divulge any such information to any other party. No part of this presentation may be (i) copied, photocopied or duplicated in any form by any means or (ii) redistributed without the prior written consent of Bridgewater. Notwithstanding anything to the contrary, a prospective investor, and each employee, representative or other agent of such prospective investor, may disclose to any and all persons, without limitation of any kind, the US federal and state income tax treatment and tax structure of a fund described herein (and any of the transactions contemplated hereby) and all materials of any kind (including opinions or other tax analyses) that are provided to a prospective investor relating to such US federal and state income tax treatment and tax structure.
This presentation has been prepared solely for informational purposes and is not an offer to buy or sell or a solicitation of an offer to buy or sell any security or to participate in any trading strategy. Any such offering, will be made pursuant to a definitive offering memorandum (the “OM”) which will contain the terms and risks of making an investment with Bridgewater in the relevant fund and other material information not contained herein and which will supersede this information in its entirety. In the event of any discrepancy between the information shown in this presentation and the OM, the OM will prevail. Investors should not construe the contents of this presentation as legal, tax, accounting, investment or other advice. Any decision to invest in a Bridgewater fund or strategy described herein should be made after carefully reviewing the OM (including the risks described therein) and all other related documents, conducting such investigations as the prospective investor deems necessary and consulting such investor’s own investment, legal, accounting and tax advisors in order to make an independent determination of the suitability and consequences of an investment in such fund or strategy.
An investment in any Bridgewater fund or strategy involves significant risks and there can be no assurance that any fund or strategy will achieve its investment objective or any targets or that investors will receive any return of their capital. An investment in any Bridgewater fund or strategy is suitable only for sophisticated investors and requires the financial ability and willingness to accept the high risks inherent in such an investment (including the risk of loss of their entire investment) for an indefinite period of time. Past performance is not indicative of future results.
This presentation and the OM will only be made available to persons or entities who are “accredited investors” under the Securities Act of 1933, as amended, and “qualified purchasers” under the Investment Company Act of 1940, as amended. The distribution of this presentation and the OM may be restricted by law in certain jurisdictions, and it is the responsibility of persons into whose possession this presentation or the OM comes to inform themselves about, and observe, any such restrictions.
The shares in the fund may not be offered or sold to the public in Brazil. Accordingly, the shares in the fund have not been nor will be registered with the Brazilian Securities Commission - CVM nor have they been submitted to the foregoing agency for approval. Documents relating to the shares in the fund, as well as the information contained therein, may not be supplied to the public in Brazil, as the offering of shares in the fund is not a public offering of securities in Brazil, nor used in connection with any offer for subscription or sale of securities to the public in Brazil.
Certain information contained herein constitutes forward-looking statements (including projections, targets, hypotheticals, ratios, estimates, returns, performance, opinions, activity and other events contained or referenced herein), which can be identified by the use of terms such as “may,” “will,” “should,” “expect,” “anticipate,” “project,” “estimate,” “intend,” “continue” or “believe” or other variations (or their negatives) thereof. Due to various risks, assumptions, uncertainties and actual events, including those discussed herein and in the OM, actual results, returns or performance can differ materially from those reflected or contemplated in such forward-looking statements. As a result, prospective investors should not rely on such forward-looking statements in making their investment decisions. While Bridgewater believes that there is a sound basis for these forward-looking statements, no representations are made as to their accuracy, and there can be no assurance that such results will be achieved. Any forward-looking statements contained herein reflect Bridgewater’s current judgment and assumptions which may change in the future, and Bridgewater has no obligation to update or amend such forward-looking statements.
Bridgewater’s investment process seeks to understand the cause and effect linkages that drive markets over time. To assess and refine its understanding of these linkages, Bridgewater performs historical stress-tests across a wide range of timeframes and market environments. From these stress-tests, Bridgewater is able to simulate how its strategies would have performed prior to their inception. Bridgewater has the ability to run multiple simulations and select the simulation with the best results, returns or performance. For strategies that include active decision making, Bridgewater often “humbles” its simulated alpha returns (by systematically adjusting downward the simulated results that Bridgewater’s current alpha investment logic produces) to account for the possibility that it could be wrong. Because this stress-testing is a core component of Bridgewater’s investment process, it shares these simulations with current and prospective investors to demonstrate its thinking. However, because they do not demonstrate actual results, these simulations are hypothetical, and inherently limited and should not be relied upon to make an investment decision.
The recipient should not solely rely upon these hypothetical performance results in making an investment decision. In constructing hypothetical performance and determining their appropriateness for use in materials, Bridgewater has an incentive to do so in a manner that shows beneficial characteristics of a given, hypothetical return stream.
All hypothetical performance is subject to revision and provided solely as a guide to current expectations. The recipient should not solely rely upon these hypothetical performance results in making an investment decision. Hypothetical performance results can provide insight into the level of risk that a strategy will seek with respect to its investments, with higher hypothetical performance results generally reflecting greater risk. Some or all results may be substantially lower than these hypothetical results and, as with any investment, there is a risk of loss of the entire investment.
Hypothetical performance results rely on numerous criteria, assumptions, risks and limitations and are inherently uncertain. There are multiple assumptions and possible adjustments Bridgewater may make in its underlying calculations that are reasonable, but other criteria, assumptions, methodologies and adjustments could also be reasonable and could lead to materially different and lower actual results and higher risks than those presented. In addition, the hypothetical performance results may prove to be invalid, inaccurate, incomplete or change without notice. Variation in any of these factors (or factors or events that are unknown or unaccounted for) could cause actual returns to substantially differ. In constructing hypothetical returns and determining their appropriateness for use in materials, Bridgewater has an incentive to do so in a manner that shows beneficial characteristics of a given, hypothetical return stream. Furthermore, any hypothetical or mathematical calculations or data might contain errors, and could rely on third-party inputs, which Bridgewater believes to be reliable but whose accuracy cannot be guaranteed.
While Bridgewater believes that there is a sound basis for these hypothetical performance results, no representations are made as to their accuracy, and there can be no assurance that such results will be achieved. This presentation will not be updated or amended even if there are changes in the information or processes upon which they rely.
Bridgewater believes that a particular return stream should be evaluated against its expected performance or its benchmark. To that end, Bridgewater demonstrates whether its strategies are operating as expected via a cone chart, which shows the performance of a particular strategy over time relative to the strategy’s benchmark and also within bands of standard deviation from that benchmark. Separately, to demonstrate the impact of market conditions on the strategies it manages, Bridgewater explains the macro-economic pressures and market conditions that effected performance in the context of client letters, account reviews, or other publications that Bridgewater provides to each current and prospective investor on a regular basis. Additional information about how Bridgewater thinks about setting expectations for its strategies via a benchmark is available upon request.
Any tables, graphs or charts relating to past performance, whether hypothetical, simulated or actual, included in this presentation are intended only to illustrate the performance of indices, strategies, or specific accounts for the historical periods shown. When creating such tables, graphs and charts, Bridgewater may incorporate assumptions on trading, positions, transactions costs, market impact estimations and the benefit of hindsight. For example, transaction cost estimates used in simulations are based on historical measured costs and/or modeled costs, and attribution is derived from a process of attributing positions held at a point in time to specific market views and is inherently imprecise. Such tables, graphs and charts are not intended to predict future performance and should not be used as a basis for making any investment decision. Bridgewater has no obligation to update or amend such tables, graphs or charts.
Statements regarding target performance or target ratios related to assumed risk budgets, liabilities, volatility, target volatility, tracking error or other targets are hypothetical in nature and should not be considered a guarantee that such results can or will be achieved. For example, Bridgewater may adjust returns to match, for instance, the annualized standard deviation of two or more return series but this adjustment does not suggest that the returns or assets are similar with respect to other aspects of the risk such as liquidity risk. Any statements with respect to the ability to risk match or risk adjust in the future are not a guarantee that the realized risks will be similar and material divergences could occur. All performance and risk targets contained herein are subject to revision by Bridgewater and are provided solely as a guide to current targets.
Discussions related to the risk controlling capabilities of low risk portfolios, diversification, passive investing, risk management, risk adjusting, and any other risk control theories, statements, measures, calculations and policies contained herein should not be construed as a statement that Bridgewater has the ability to control all risk or that the investments or instruments discussed are low or will lower any risk. Active trading comes with a monetary cost and high risk and there is no guarantee the cost of trading will not have a materially adverse impact on any account, fund, portfolio or other structure. Bridgewater manages accounts, funds and strategies not referred to herein. For such accounts, funds and strategies, and, even where accounts, funds or strategies are traded similarly, performance may materially diverge based on, among other factors, timing, the approved instruments, markets, and target risk for each strategy or market. The price and value of the investments referred to in this presentation and the income, if any, derived therefrom may fluctuate.
Bridgewater uses different types of performance in its materials. Unless otherwise indicated, such types of performance can be understood as follows:
Hypothetical Performance refers to any return stream that is not actual performance. Hypothetical performance includes, for example, Simulated Performance and Related Fund or Related Share Class Performance.
Simulated Performance refers to hypothetical performance that shows the returns of a Bridgewater strategy prior to its inception date. Simulated performance does not reflect actual trading by Bridgewater and is constructed by applying Bridgewater’s investment management process to available market data.
Related Fund or Related Share Class Performance refers to actual performance that has been adjusted to account for volatility and/or currency differences. Because it is based on actual performance, Related Fund or Related Share Class Performance does reflect actual trading by Bridgewater, which has been adjusted on the basis of currency, volatility, or both and is thus hypothetical. Note that the terms Related Fund or Related Share Class Performance are not being used in the same way that the term ‘Related Performance’ is used in the Securities and Exchange Commission’s Marketing Rule.
Statistical and mathematical measures of performance and risk measures based on past performance, market assumptions or any other input should not be relied upon as indicators of future results. While Bridgewater believes the assumptions and possible adjustments it may make in making the underlying calculations are reasonable, other assumptions, methodologies and adjustments could have been made that are reasonable and would result in materially different results, including materially lower results. Where shown, targeted performance and the abilities and capabilities of the active and passive management approaches discussed herein are based on Bridgewater’s analysis of market data, quantitative research of the underlying forces that influence asset classes as well as management policies and objectives, all of which are subject to change. The material contained herein may exhibit the potential for attractive returns, however it also involves a corresponding high degree of risk. Targeted performance, whether mathematically based or theoretical, is considered hypothetical and is subject to inherent limitations such as the impact of concurrent economic or geo-political elements, forces of nature, war and other factors not addressed in the analysis, such as lack of liquidity. Please see additional discussions of hypothetical performance herein for important information on the risks and limitations thereof. There is no guarantee that the targeted performance for any fund or strategy shown herein can or will be achieved. A broad range of risk factors, individually or collectively, could cause a fund or strategy to fail to meet its investment objectives and/or targeted returns, volatilities or correlations.
Where shown, information related to markets traded may not necessarily indicate the actual historical or current strategies of Bridgewater. Markets listed might not be currently traded and are subject to change without notice. Markets listed are used for illustrative purposes, may not represent the universe of markets traded or results available and may not include actual trading results of Bridgewater. Other markets or trading, not shown herein, can have had materially different results. Attribution of performance or designation of markets and the analysis of performance or other performance with respect to scenario analysis or the determination of biases is based on Bridgewater’s analysis. Statements made with respect to the ability of Bridgewater, a fund, a strategy, a market or instrument to perform in relation to any other market, instrument or manager in absolute terms or in any specific manner in the future or any specified time period are not a guarantee of the desired or targeted result.
Where shown, expected ratios and similar risk and returns analytics are provided to reflect the range of reasonably likely long-term, risk and return characteristics of a given strategy. Accordingly, such figures and analytics do not reflect performance targets or performance projections at (any) given point(s). Note that, at any point in time, risk and/or return of a strategy can differ, sometimes materially, from long term expected return and risk characteristics.
Bridgewater research utilizes data and information from public, private, and internal sources, including data from actual Bridgewater trades. Sources include BCA, Bloomberg Finance L.P., Bond Radar, Candeal, CEIC Data Company Ltd., Ceras Analytics, China Bull Research, Clarus Financial Technology, CLS Processing Solutions, Conference Board of Canada, Consensus Economics Inc., DTCC Data Repository, Ecoanalitica, Empirical Research Partners, Energy Aspects Corp, Entis (Axioma Qontigo Simcorp), Enverus, EPFR Global, Eurasia Group, Evercore ISI, FactSet Research Systems, Fastmarkets Global Limited, The Financial Times Limited, Finaeon, Inc., FINRA, GaveKal Research Ltd., GlobalSource Partners, Harvard Business Review, Haver Analytics, Inc., Institutional Shareholder Services (ISS), The Investment Funds Institute of Canada, ICE Derived Data (UK), Investment Company Institute, International Institute of Finance, JP Morgan, JTSA Advisors, LSEG Data and Analytics, MarketAxess, Metals Focus Ltd, MSCI, Inc., National Bureau of Economic Research, Neudata, Organisation for Economic Cooperation and Development, Pensions & Investments Research Center, Pitchbook, Political Alpha, Renaissance Capital Research, Rhodium Group, RP Data, Rubinson Research, Rystad Energy, S&P Global Market Intelligence, Sentix GmbH, SGH Macro, Shanghai Metals Market, Smart Insider Ltd., Sustainalytics, Swaps Monitor, Tradeweb, United Nations, US Department of Commerce, Visible Alpha, Wells Bay, Wind Financial Information LLC, With Intelligence, Wood Mackenzie Limited, World Bureau of Metal Statistics, World Economic Forum, YieldBook. While we consider information from external sources to be reliable, we do not assume responsibility for its accuracy. Data leveraged from third-party providers, related to financial and non-financial characteristics, may not be accurate or complete. The data and factors that Bridgewater considers within its investment process may change over time.
None of the information related to a fund or strategy that Bridgewater provides is intended to form the basis for any investment decision with respect to any retirement plan’s (or any investor’s) assets. Any information Bridgewater provides should be independently and critically evaluated based on whatever other sources are deemed appropriate, including legal and tax advice; it is also not intended to be impartial investment information or advice as Bridgewater can recommend one or more Bridgewater products in connection with such information, which would result in additional fees being paid to Bridgewater. Bridgewater’s status as an ERISA fiduciary with respect to the management of any existing or future Bridgewater product(s) in which you invest would be (or continue to be) set forth in that product’s applicable governing instruments. You are responsible for ensuring that your decision to invest in any Bridgewater product does not violate the fiduciary or prohibited transaction rules of ERISA, the US Internal Revenue Code or any applicable laws or regulations that are similar. On and after June 9, 2017, the information provided herein is being made available only to “independent fiduciaries with financial expertise” (within the meaning of the Definition of the Term “Fiduciary”; Conflict of Interest Rule – Retirement Investment Advice, 81 Fed. Reg. 20,946 (Apr. 8, 2017), available at https://www.gpo.gov/fdsys/pkg/FR-2016-04-08/pdf/2016-07924.pdf), and this presentation should not be accepted by any person who does not meet such requirements.
This presentation was written in connection with the promotion or marketing of a Bridgewater fund or strategy, and it was not intended or written to be used and cannot be used by any person for the purpose of avoiding penalties that may be asserted under the US Internal Revenue Code.
In certain instances amounts and percentages in this presentation are approximate and have been rounded for presentation purposes. Statements in this presentation are made as of the date appearing on this presentation unless otherwise indicated. Neither the delivery of this presentation or the OM shall at any time under any circumstances create an implication that the information contained herein is correct as of any time subsequent to such date. Bridgewater has no obligation to inform potential or existing investors when information herein becomes stale, deleted, modified or changed. ©2025 Bridgewater Associates, LP. All rights reserved.